Daily Commentary (22-Nov): The Government finally announced to cancel bond auctions for the remainder of this year. This reconfirms our view published on 13-Oct and reiterated on 13-Nov. Benchmark bond series’ prices continued to increase, sending bond yields lower after the announcement on Thursday. The 5yr FR63 was traded at 91.5 (+0.1%). yielding 7.91% (-1.6 bps); the10yr FR64 at 88.2 (+0.3%), yielding 7.91% (-3.6 bps); the 15yr FR65 at 86.3 (+0.1%), yielding 8.26% (-1.5 bps); and the 20yr FR75 at 91.6 (+0.2%), yielding 8.38% (-2 bps).
According to PLTE data, trading volume in the secondary market continued to increase to Rp15tn (vs. Rp12.4tn in the previous day), with foreign (again) posting net buy of Rp2.5tn, – specifically for benchmark series, foreign reported net buy of Rp0.4tn. All the institutional onshore investors were reported as net sellers. Based on DMO website data, foreign ownership in government bond based on settlement date as of 21-Nov was Rp889.2bn (inflow of Rp24.9tn mtd or +Rp53.1tn ytd) or 38% of total outstanding.
JCI was also up 0.7% to 5,990.8 (+2.7% mtd or -5.7% ytd) with foreign investors reported at net inflow of Rp218.9bn (inflow of Rp9.7tn mtd and outflow of Rp44.9tn ytd). Rupiah also appreciated by 0.2% to Rp14,580/USD (appreciated 4.1% mtd but still depreciated 7.5% ytd). (Source: Mandiri Sekuritas)